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Michigan starts 'contingency planning' for government shut down

State lawmakers have until the end of September to agree on a budget for the upcoming fiscal year.

LANSING, Mich. — State officials will be giving an update on the budget and potential for a government shut down if lawmakers and the governor can't agree on road funding.

Michigan lawmakers have until the end of September to agree on a budget, for the upcoming fiscal year -- or face a government shutdown. Which is because Gov. Gretchen Whitmer and the Republican-led legislature still can't agree on funding for roads and education. 

Though tax increases, fund shifts and pension-related refinancing moves are under consideration, the sides do not appear close to any resolution nearly six months after Whitmer's proposed 45-cents-a-gallon fuel tax increase to "fix the damn roads" quickly flamed out. 

RELATED: Michigan superintendents sound alarm over lack of state budget

RELATED: No consensus on Michigan road fix as budget deadline nears

The tax increase would have generated an additional $2.5 billion in constitutionally protected transportation revenue, a $917 billion boost in the coming fiscal year and $1.9 billion above what is expected for the 2020-21 budget if lawmakers also agreed to her request to stop diverting general funds to roads.

Recently, superintendents statewide sounded an alarm over starting school without knowing how much state funding their districts will receive, saying it affects staffing and other decisions. This is the first time in a decade that school leaders have not known their state aid by July, the beginning of schools' fiscal year. 

On Tuesday, it was learned that the state started "contingency planning" for a potential shut down. 

Officials are working to figure out which government functions must continue -- and which can be stopped -- in the event of a shutdown. The deadline for the budget is Oct. 1.

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